Kenya Airways six-month loss soars to Sh21 billion on forex hit
In the six months to June 2023, Kenya Airways suffered a net loss of Kes21.7 billion, a notable increase from the Kes9.9 billion loss recorded in June 2022 as a result of rising costs and foreign exchange-related losses.
Despite this, the airline witnessed a substantial upswing in turnover, with a remarkable 56 percent increase to Kes75 billion. This growth was fueled by a significant boost in passenger revenue, contributing Kes30 billion to the overall turnover.
However, operating costs escalated from Kes57.9 billion to Kes96.7 billion within the first half of the year. A considerable portion of this increase was attributed to Kes17.8 billion in foreign exchange-related losses.
Despite the financial challenges, Kenya Airways managed to swing into operating profit territory, recording Kes998 million in operating profit. This marked a remarkable 120 percent improvement from the Kes5 billion loss position reported during the same period in 2022.
Kenya Airways’ operating profit for the first half of 2023 is seen as a positive indicator of the airline’s recovery efforts and a reflection of the ongoing progress within the air transportation sector. The result also underscores the airline’s commitment to regaining profitability and signifies that the strategic measures implemented by the management are yielding promising results.
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Kenya Airways’ future plans
During the reporting period, Kenya Airways CEO Allan Kilavuka says the airline made substantial strides in enhancing customer experience across various touchpoints. The reliability and availability of the airline’s aircraft witnessed significant improvements, leading to an increase in On-time Performance (OTP) from 58 percent at the beginning of the year to 77 percent by the end of June. The airline aims to achieve an OTP of above 80 percent, further emphasizing its dedication to providing a seamless travel experience for its passengers.
The Group CEO, Allan Kilavuka, highlighted the airline’s plans for the future, focusing on recapitalization efforts to establish a foundation for long-term growth. The airline’s network expansion and fleet optimization strategies aim to enhance passenger and cargo capacities, further aligning with its goal of operational resilience.
Looking ahead, the airline anticipates a promising trend in forward bookings for the second half of the year. This optimistic projection reinforces the belief that Kenya Airways is on course navigating the challenges of the aviation industry while capitalizing on opportunities for growth and recovery.
Mr Michael Joseph, the Chairman of the Board, said, “The operating profit of Kes998 million in the first half of 2023 underscores the airline’s outstanding performance and offers encouraging indications of ongoing recovery within the air transportation sector.”
